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Ending the Williams model?

In an address to a special convention of the PNM on November 27, 1970, by Dr Eric Williams entitled “PNM’s Perspectives in the World of the Seventies” during which he presented “The Chaguaramas Declaration: The People’s Charter Revised”, he outlined a new philosophical direction for the party and the country. One of the more significant excerpts from his Convention Address read as follows:

“The PNM Perspectives reject both liberal capitalism (with its concomitant of penetration and take-over of the economy by multi-national corporations) and the communist organization of the economy and the society. Instead, we follow the pattern that is being increasingly developed by developing countries of state participation in the economy, to the extent of up to 51 per cent in particular enterprises, to ensure that decision-making remains in local hands.” (p 12).

This philosophical position has defined the policy positions of both the PNM and the State for the last 48 years. Momentarily, in 2003, it appeared that the Manning PNM was prepared to commence the dismantling of this model when it undertook the closure of Caroni (1975) Ltd. However, that was short-lived as the momentum to create new state enterprises gained steam during the gas boom that followed.

The Williams model as articulated in 1970 took effect with the creation of the National Petroleum Marketing Corporation (NP) in 1972 and the nationalisation of Shell on Independence Day in 1974 and the creation of Trintoc, and gained further momentum during the oil boom of the 1970s with the creation of the National Gas Company (NGC) in 1975 and continued during the downturn in the 1980s when the Texaco refinery was nationalised.

Petrotrin became the crown jewel in the state enterprise thrust that epitomized the philosophy that drove the Williams model. There was also supposed to be a special role for trade unions as Williams’ 1970 speech on the PNM Perspectives went further to say as follows:

“PNM’s Perspectives place great emphasis on the participation by trade unions in economic activity.” (p 15).

Last Tuesday, virtually three years to the day when JTUM and the PNM signed an MOU just in time for the 2015 general election, all of that changed. The demise of Petrotrin as we know it is indeed a watershed moment in the politics and economics of this country. The Williams model that supported it has now been set aside. The reality is that that model only seemed to work when the State had money to sustain the dominant role for the State.

The trade unions have argued that corruption and mismanagement have caused the decline of Petrotrin. The Government has timed its move on Petrotrin to coincide with its signing of a gas agreement with the Venezuelan Government. The members of the trade union movement in this country are strong supporters of the Maduro administration in Caracas, so the political optics cannot be ignored.

At the same time, the Government is well aware that JTUM is hostile to the UNC so their political gamble is that they would be unlikely bedfellows during this philosophical shift.

With Maduro and Rowley being on chummy terms and Roget and Persad-Bissessar being poles apart, now would be the politically opportune moment to make the move to close Petrotrin because the stars are not aligned here.

Back in May, Finance Minister Colm Imbert said that the economy had turned around and that the rain had gone and he could see clearly now. This will serve to increase the tone of the rhetoric and pushback against the Government by the unions. Was the policy move at Petrotrin part of that “turnaround” or must it be assessed separately?

There is undoubtedly a looming political challenge. In the absence of full disclosure about how the Government got to this policy option, there will continue to be unease.

The Prime Minister is expected to address the nation tonight. The unions are expected to take action next Friday. This is going to turn into a political showdown between the Government and the trade unions.

Once it does, it could turn into a battle royal in which the internal elections of the PNM will provide Dr Rowley with the opportunity to have frequent platforms to articulate his specific case and vision, while the unions will try to influence PNM voters about their case. If Rowley and his slate emerge victoriously, he will feel vindicated.